by Katherine Mejia
Now more than ever it is important to maintain good credit and keep debt up to date so that the current credit crisis does not eat away at your financial stability. Credit cards are useful because they give the borrower the opportunity to create credit. But credit cards can also destroy the opportunities good credit offers if payments are not made on time or ever at all.
The worst thing for a person to have to do is to have to file for bankruptcy or consolidate their debt. Making these choices can put a damper on your credit score for a very long time and when the time comes when you want to mortgage a house ( assuming that the economy is not as volatile as it is today), most banks will not think twice about showing you the door . To avoid this all credit card users have to do is spend wisely. Borrowers should not use credit cards to buy things they cannot pay off in a short number of payments.
Credit cards are necessary evil; they are very beneficial when used correctly. Credit Bureaus reward people with good credit by offering them lower interest rates. Being in debt is necessary, but being as far away from credit limits is also necessary to benefit from credit cards. The Fed is making changes so that credit card companies do not abuse their power over their customers but any changes are still far away so it is best to make a plan and make yourself aware healthy habits you should maintain when managing your credit.
The worst thing for a person to have to do is to have to file for bankruptcy or consolidate their debt. Making these choices can put a damper on your credit score for a very long time and when the time comes when you want to mortgage a house ( assuming that the economy is not as volatile as it is today), most banks will not think twice about showing you the door . To avoid this all credit card users have to do is spend wisely. Borrowers should not use credit cards to buy things they cannot pay off in a short number of payments.
Credit cards are necessary evil; they are very beneficial when used correctly. Credit Bureaus reward people with good credit by offering them lower interest rates. Being in debt is necessary, but being as far away from credit limits is also necessary to benefit from credit cards. The Fed is making changes so that credit card companies do not abuse their power over their customers but any changes are still far away so it is best to make a plan and make yourself aware healthy habits you should maintain when managing your credit.
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